You are here

How to Implement True, Full Employment

HOW TO IMPLEMENT TRUE, FULL EMPLOYMENT

By L. Randall Wray [*]

We will briefly describe a program that would generate true, full employment, price stability, and currency stability. We will show that this program can be adopted in any nation that issues its own currency. Our presentation consists of three sections. First, we briefly examine a pilot program at the University of Missouri—Kansas City (UMKC). This provides the basis for the analysis in the second section of the functioning of a national monetary system. Finally, we show how this knowledge can be used to construct a public service program (PSE) that guarantees true, full employment with price and currency stability.

The Buckaroo Program

In the United States, there is a growing movement on college campuses to increase student involvement in their communities, particularly through what is known as "service-learning" in which students participate in community service activities organized by local community groups. It should become obvious that a modern monetary economy that adopts the full employment program described here will operate much like our community service hours program.

We have chosen to design our program as a "monetary" system, creating paper notes, "buckaroos" (after the UMKC mascot, a kangaroo), with the inscription "this note represents one hour of community service by a UMKC student", and denominated as "one roo hour". Each student is required to pay B25 to the UMKC "Treasury" each semester. Approved community service providers (state and local government offices, university offices, public school districts, and not-for-profit agencies) submit bids for student service hours to the Treasury, which "awards" special drawing rights (SDRs) to the providers so long as basic health, safety, and liability standards are met. The providers then draw on their SDRs as needed pay students B1 per hour worked. This is equivalent to "spending" by the UMKC treasury. Students then pay their taxes with buckaroos, retiring Treasury liabilities.

Several implications are immediately obvious. First, the UMKC treasury cannot collect any buckaroo taxes until it has spent some buckaroos. Second, the Treasury cannot collect more buckaroos in payment of taxes than it has previously spent. This means that the "best" the Treasury can hope for is a "balanced budget". Actually, it is almost certain that the Treasury will run a deficit as some buckaroos are "lost in the wash" or hoarded for future years. While it is possible that the Treasury could run a surplus in future years, this would be limited by the quantity of previously hoarded buckaroos that could be used to pay taxes. Third, and most important, it should be obvious that the Treasury faces no "financial constraints" on its ability to spend buckaroos. Indeed, the quantity of buckaroos provided is "market demand determined", by the students who desire to work to obtain buckaroos and by the providers who need student labor. Furthermore, it should be obvious that the Treasury’s spending doesn’t depend on its tax receipts. To drive the point home, we can assume that the Treasury always burns every buckaroo received in payment of taxes. In other words, the Treasury does not impose taxes in order to ensure that buckaroos flow into its coffers, but rather to ensure that student labor flows into community service. More generally, the Treasury’s budget balance or imbalance doesn’t provide any useful information to UMKC regarding the program’s success or failure. A Treasury deficit, surplus, or balance provides useless accounting data.

Note that each student has to obtain a sufficient number of buckaroos to meet her tax liability. Obviously, an individual might choose to earn, say, B35 in one semester, holding B10 as a hoard after paying the B25 tax for that semester. The hoards, of course, are by definition equal to the Treasury’s deficit. UMKC has decided to encourage "thrift" by selling interest-earning buckaroo "bonds", purchased by students with excess buckaroo hoards. This is usually described as government "borrowing", thought to be necessitated by government deficits. Note however, that the Treasury does not "need" to borrow its own buckaroos in order to deficit spend—no matter how high the deficit, the Treasury can always issue new buckaroos. Indeed, the Treasury can only "borrow" buckaroos that it has already spent, in fact, that it has "deficit spent". Finally, note that the Treasury can pay any interest rate it wishes, because it does not "need" to "borrow" from students. For this reason, Treasury bonds should be seen as an "interest rate maintenance account" designed to keep the base rate at the Treasury’s target interest rate. Without such an account, the "natural base interest rate" is zero for buckaroo hoards created through deficit spending. Note that no matter how much the Treasury spends the base rate would never rise above zero unless the Treasury offers positive interest rates; in other words, Treasury deficits do not place any pressure on interest rates.

What determines the value of buckaroos? From the perspective of the student, the "cost" of a buckaroo is the hour of labor that must be provided; from the perspective of the community service provider, a buckaroo buys an hour of student labor. So, on average, the buckaroo is worth an hour of labor—more specifically, an hour of average student labor. Note that we can determine the value of the buckaroo without reference to the quantity of buckaroos issued by the Treasury. Whether the Treasury spends a hundred thousand buckaroos a year, or a million a year, the value is determined by what students must do to obtain them.

The Treasury’s deficit each semester is equal to the "extra" demand for buckaroos coming from students; indeed, it is the "extra" demand that determines the size of the Treasury’s deficit. We might call this "net saving" of buckaroos, and it is equal—by definition—to the Treasury’s deficit over the same period. What if the Treasury decided it did not want to run deficits, and so proposed to limit the total number of buckaroos spent in order to balance the budget? In this case, it is almost certain that some students would be unable to meet their tax liability. Unlucky, procrastinating students would find it impossible to find a community service job, thus would find themselves "unemployed" and would be forced to borrow, beg, or steal buckaroos to meet their tax liabilities. Of course, any objective analysis would find the source of the unemployment in the Treasury’s policy, and not in the characteristics of the unemployed. Unemployment at the aggregate level is caused by insufficient Treasury spending.

Some of thisanalysis applies directly to our economic system as it actually operates, while some of it would apply to the operation of our system if it were to adopt a full employment program. Let us examine the operation of a modern money system.

Modern Monetary Systems

In all modern economies, money is a creature of the State. The State defines money as that which it accepts at public pay offices (mainly, in payment of taxes). Taxes create a demand for money, and government spending provides the supply, just as our buckaroo tax creates a demand for buckaroos, while spending by the Treasury provides the supply. The government does not "need" the public's money in order to spend; rather, the public needs the government's money in order to pay taxes. This means that the government can buy whatever is for sale in terms of its money merely by providing it.

Because the public will normally wish to hold some extra money, the government will normally have to spend more than it taxes; in other words, the normal requirement is for a government deficit, just as the UMKC Treasury always runs a deficit. Government deficits do not require "borrowing" by the government (bond sales), rather, the government provides bonds to allow the public to hold interest-bearing alternatives to non-interest-bearing government money. Further, markets cannot dictate to government the interest rate it must pay on its debt, rather, the government determines the interest rate it will pay as an alternative to non-interest-earning government money. This stands conventional analysis on its head: fiscal policy is the primary determinant of the quantity of money issued, while monetary policy primarily has to do with maintaining positive interest rates through bond sales—at the interest rate the government chooses.

In summary, governments issue money to buy what they need; they tax to generate a demand for that money; and then they accept the same money in payment of the tax. If a deficit results, that just lets the population hoard some of the money. If the government wants to, it can let the population trade the money for interest earning bonds, but the government never needs to borrow its own money from the public.

This does not mean that the deficit cannot be too big, that is, inflationary; it can also be too small, that is deflationary. When the deficit is too small, unemployment results (just as it results at UMKC when the Treasury’s spending of buckaroos is too small). The fear, of course, is that government deficits might generate inflation before full employment can be reached. In the next section we describe a proposal that can achieve full employment while actually enhancing price stability.

Public Service Employment and Full Employment with Price and Currency Stability

Very generally, the idea behind our proposal is that the national government provides funding for a program that guarantees a job offer for anyone who is ready, willing and able to work. We call this the Public Service Employment program, or PSE. What is the PSE program? What do we want to get out of it?

It should offer a job to anyone who is ready, willing and able to work; regardless of race or gender, regardless of education, regardless of work experience; regardless of immigration status; regardless of the performance of the economy. Just listing those conditions makes it clear why private firms cannot possibly offer an infinitely elastic demand for labor. The government must play a role. At a minimum, the national government must provide the wages and benefits for the program, although this does not actually mean that PSE must be a government-run program.

We want PSE to hire off the bottom. It is an employment safety net. We do not want it to compete with the private sector or even with non-PSE employment in the public sector. It is not a program that operates by "priming the pump", that is, by raising aggregate demand. Trying to get to full employment simply by priming the pump with military spending could generate inflation. That is because military Keynesianism hires off the top. But by definition, PSE hires off the bottom; it is a bufferstock policy—and like any bufferstock program, it must stabilize the price of the bufferstock—in this case, wages at the bottom.

We want full employment, but with loose labor markets. This is virtually guaranteed if PSE hires off the bottom. With PSE, labor markets are loose because there is always a pool of labor available to be hired out of PSE and into private firms. Right now, loose labor markets can only be maintained by keeping people out of work—the old reserve army of the unemployed approach.

We want the PSE compensation package to provide a decent standard of living even as it helps to maintain wage and price stability. We have suggested that the wage ought to be set at $6.25/hr in the USA to start. A package of benefits could include healthcare, childcare, sick leave, vacations, and contributions to Social Security so that years spent in PSE would count toward retirement.

We want PSE experience to prepare workers for post-PSE work—whether in the private sector or in government. Thus, PSE workers should learn useful work habits and skills. Training and retraining will be an important component of every PSE job.

Finally, we want PSE workers to do something useful. For the U.S.A. we have proposed that they focus on provision of public services, however, a developing nation may have much greater need for public infrastructure; for roads, public utilities, health services, education. PSE workers should do something useful, but they should not do things that are already being done, and especially should not compete with the private sector.

These six features pretty well determine what a PSE program ought to look like. This still leaves a lot of issues to be examined. Who should administer the program? Who should do the hiring and supervision of workers? Who should decide exactly what workers will do? There are different models consistent with this general framework, and different nations might take different approaches. Elsewhere (Wray 1998, 1999) I have discussed the outlines of a program designed specifically for the USA. Very briefly, I suggest that given political realities in the USA, it is best to decentralize the program as much as possible. State and local governments, school districts, and non-profit organizations would be allowed to hire as many PSE workers as they could supervise. The federal government would provide the basic wage and benefit package, while the hiring agencies would provide supervision and capital required by workers (some federal subsidy of these expenses might be allowed). All created jobs would be expected to increase employability of the PSE workers (by providing training, experience, work records); PSE employers would compete for PSE workers, helping to achieve this goal. No PSE employer would be allowed to use PSE workers to substitute for existing employees (representatives of labor should sit on all administrative boards that make hiring decisions). Payments by the federal government would be made directly to PSE workers (using, for example, Social Security numbers) to reduce potential for fraud.

Note that some countries might choose a much higher level of centralization. In other words, program decentralization is dictated purely by pragmatic and political considerations. The only essential feature is that funding must come from the national government, that is, from the issuer of the currency.

Before concluding, let us quickly address some general questions. First, many people wonder about the cost—can we afford full employment? To answer this, we must distinguish between real costs and financial expenditures. Unemployment has a real cost—the output that is lost when some of the labor force is involuntarily unemployed, the burdens placed on workers who must produce output to be consumed by the unemployed, the suffering of the unemployed, and social ills generated by unemployment and poverty. From this perspective, providing jobs for the unemployed will reduce real costs and generate net real benefits for society. Indeed, it is best to argue that society cannot afford unemployment, rather than to suppose that it cannot afford employment!

On the other hand, most people are probably concerned with the financial cost of full employment, or, more specifically, with the impact on the government’s budget. How will the government pay for the program? It will write checks just as it does for any other program. (See Wray 1998.) This is why it is so important to understand how the modern money system works. Any nation that issues its own currency can financially afford to hire the unemployed. A deficit will result only if the population desires to save in the form of government-issued money. In other words, just as in UMKC’s buckaroo program, the size of the deficit will be "market demand" determined by the population’s desired net saving.

Economists usually fear that providing jobs to people who want to work will cause inflation. Thus, it is necessary to explain how our proposed program will actually contribute to wage stability, promoting price stability. The key is that our program is designed to operate like a "buffer stock" program, in which the buffer stock commodity is sold when there is upward pressure on its price, or bought when there are deflationary pressures. Our proposal is to use labor as the buffer stock commodity, and as is the case with any buffer stock commodity, the program will stabilize the commodity's price. The government’s spending on the program is based on a "fixed price/floating quantity" model, hence, cannot contribute to inflation.

Note that the government’s spending on the full employment program will fluctuate countercyclically. When the private sector reduces spending, it lays-off workers who then flow into the bufferstock pool, working in the full employment program. This automatically increases total government spending, but not prices because the wage paid is fixed. As the quantity of workers hired at the fixed wage rises, this results in a budget deficit. On the other hand, when the private sector expands, it pulls workers out of the bufferstock pool, shrinking government spending and thus reducing deficits. This is a powerful automatic stabilizer that operates to ensure the government’s spending is at just the right level to maintain full employment without generating inflation.

[*] The author is Professor, Economics, and Senior Research Associate, The Center For Full Employment and Price Stability, University Of Missouri—Kansas City. The paper was originally published in 2001.

OVERVIEW

The World Academy of Art and Science is composed of 730 individual Fellows from diverse cultures, nationalities, and intellectual disciplines, chosen for eminence in art, the natural and social sciences, and the humanities. Established in 1960 by distinguished individuals concerned by the impact of the explosive growth of knowledge, its activities seek to address global issues related to the social consequences and policy implications of knowledge. The Academy serves as a forum for reflective scientists, artists, and scholars to discuss the vital problems of humankind independent of political boundaries or limits, whether spiritual or physical -- a forum where these problems can be discussed objectively, scientifically, globally, and free from vested interests or regional attachments, to arrive at solutions that affirm universal human rights and serve the interests of all humanity. WAAS is founded on faith in the power of original and creative ideas -- Real Ideas with effective power -- to change the world. Its motto is "Leadership in thought that leads to action."

The spirit of the Academy can be expressed in the words of Albert Einstein: "The creations of our mind shall be a blessing and not a curse to mankind." Its Fellows share the ambition (as the Founders said in their 1960 Manifesto) "to rediscover the language of mutual understanding," surmounting differences in tradition, language, and social structure which, unless fused by creative imagination and continuous effort, dissolve the latent human commonwealth in contention and conflict.

Scientific discovery and technological innovation keep developing instruments of unparalleled power for fulfillment or destruction. We humans, more and more, are taking into our own hands the future evolution of our bodies, our minds, the civilizations we create, and the very planet we inhabit. So it is imperative that we guide what we do by what we know, and guide what we know by what we value. The aim of the Academy's founders was to function as "an informal WORLD UNIVERSITY at the highest scientific and ethical level, in which deep human understanding and the fullest sense of responsibility will meet."

The World Academy is incorporated in the State of California and is recognized by the US Internal Revenue Service as a tax exempt private foundation under section 501(c)(3).

MISSION

The World Academy of Art and Science is an association of committed individuals drawn from diverse cultures, nationalities, occupations and intellectual pursuits spanning the arts, humanities and sciences, conscious of the profound social consequences and policy implications of knowledge, and united by a common aspiration to address the urgent challenges and emerging opportunities confronting humanity today. Our mission is to promote cross-disciplinary dialogue generative of original ideas and integrated perspectives that comprehend the root causes and effective remedies for our common problems, while furthering those currents of thought and social movement that affirm the value of human dignity and equitable development. The Academy dedicates itself to the pursuit of creative, catalytic ideas that can provide to present and future generations enlightened leadership in thought that leads to effective action.

HISTORY

The idea of founding an international association for exploring major concerns of humanity in a nongovernmental context grew out of many conversations that took place among leading scientists and intellectuals in the years following World War II. Prominent among this group were people such as Albert Einstein and Robert Oppenheimer who had played a part in the development of the atomic bomb and were deeply concerned about how it and other scientific advances might be used – or misused.

This informal project took a major step forward in 1956, when a meeting – The First International Conference on Science and Human Welfare – was held in Washington, D. C. The organizers were two American scientists: Richard Montgomery Field of Princeton, who had worked for many years as chairman of an international committee on the social values of science; and John A. Fleming, former President of the International Council of Scientific Unions. At the end of the conference, participants agreed to take steps toward the formation of a World Academy, and elected an International Preparatory Committee for that purpose. Its members were: (from France) Pierre Chouard, George Laclavére and G. Le Lionnaise; (from the United Kingdom) Ritchie Calder, H. Munro Fox and Joseph Needham; and (from the United States) Robert Oppenheimer.

The Academy was formally founded (and its first officers elected) in 1960. They were: as President, Lord John Boyd Orr of Scotland; as Vice Presidents, Hermann Joseph Muller of the United States and Hugo Ostvald of Sweden; and, as Secretary General, Hugo Boyko of Israel.

Advisors to the Board

PARTNERS

HOW TO DONATE TO THE ACADEMY

The World Academy is incorporated in the State of California and Fellows elected from 86 different countries. WAAS is recognized by the US Internal Revenue Service as a tax exempt private foundation under section 501(c)(3).

CADMUS JOURNAL

Cadmus is a journal for fresh thinking and new perspectives that integrate knowledge from all fields of science, art and humanities to address real-life issues, inform policy and decision-making, and enhance our collective response to the challenges and opportunities facing the world today.

ERUDITIO E-JOURNAL

Eruditio is the electronic journal of the World Academy of Art & Science. The vision of the Journal complements and enhances the World Academy's focus on global perspectives in the generation of knowledge from all fields of legitimate inquiry.

The Journal also mirrors the World Academy's specific focus and mandate which is to consider the social consequences and policy implications of knowledge in the broadest sense. It is a multidisciplinary forum focused on the social consequences and policy implications of all forms of knowledge on a global basis.

PAPERS BY CATEGORY

BOOKS

The Security & Sustainability Guide

A 250-page “Interim Draft” PDF of The S&S Guide, a project of the World Academy of Art & Science, will be available for limited distribution free of charge to WAAS Fellows in June 2016. It reflects the critical fact that sustainability and security are both essential and can only be achieved in concert. The Guide is incomplete, but the compilers believe that, even in its current state, many WAAS Fellows will nd it useful for illuminating many of the most serious problems facing humanity under the broad, overlapping categories of “Security” (weapons proliferation, terrorism, cyber-attacks, economic and food insecurity, human rights, peacemaking, crime and corruption, inadequate infrastructure, etc.) and “Sustainability” (climate change, biodiversity loss, pollution, energy, agriculture, population growth, cities, oceans, forests, vulnerability to disasters, green economics and nance, etc.)

TRANS-DISCIPLINARY FOUNDATION COURSES

Mind is humanity’s highest developed instrument for seeking knowledge. It is an instrument with remarkable capabilities and characteristic limitations. It is ironic that we invest so little time in education and scientific endeavor trying to understand the nature of mental knowledge and the... READ MORE

A Post-Graduate Certificate Course in Human-Centered Economics will be conducted by the World Academy of Art & Science, the World University Consortium, The Mother's Service Society, Person-Centered Approach Institute, Dag Hammarskjöld University College of International Relations and Diplomacy and Inter-University Centre, Dubrovnik, Croatia from Feb 1-Feb 3,2017 at Inter-University Centre, Dubrovnik, Croatia.

The multidimensional challenges confronting humanity today are human-made and can be changed by a change in thought and action. Contemporary economic thought is built on a mind-frame that originated prior to the Industrial Revolution when scarcity of goods in a world of abundant resources was the primary concern, economic growth was considered synonymous with human welfare, and impact of humanity on the environment was completely ignored. Without challenging obvious flaws in existing theory, it will be not be possible to significantly alter current policies and practices.

The overall aim of the course is to (a) demonstrate why mainstream neo-classical economic theory is inappropriate for dealing with the global challenges of the c.21st, and (b) explore alternative approaches for achieving ecologically sustainable, human-centered development and welfare for all.

This course will present the findings of a five year research program of the World Academy of Art & Science and the on-going work of the New Economic Theory working group. It will harness the best available ideas and practices on human-centred, sustainable economy to create informative, authoritative and compelling educational and communication tools with the power to challenge and alter university level education in Economics, public policy, business decisions, media coverage and general public opinion regarding how the world economy should and can work for the betterment of all humanity.

A Post-Graduate Certificate Course in Social Power, Empowerment & Social Evolution will be conducted by the World Academy of Art & Science, the World University Consortium, The Mother's Service Society, Person-Centered Approach Institute, Dag Hammarskjöld University College of International Relations and Diplomacy and Inter-University Centre, Dubrovnik, Croatia from Oct 31-Nov 4, 2016 at Inter-University Centre, Dubrovnik, Croatia.

Humanity lives in a time of unprecedented capacity for accomplishment in every field of social life. Never before have we possessed power of this magnitude for good or for evil. Never before has power been so widely distributed within society. Democracy, law, human rights, science, technology, education and many other forms of social organization have generated immense power. Society governs the possession and exercise of this power through formal structures and institutions, such as law and human rights, as well as through both legitimate and extra-legal informal mechanisms including status, wealth, popularity, political influence and corruption. The distribution of power in its various forms powerfully impacts on the functioning of the economy, political system, educational, scientific, religious and and other social institutions, and on the overall productivity, strength, integrity, harmony and welfare of society. This transdisciplinary course will explore the sources, expressions, determinants and consequences of the creation, distribution and exercise of social power in its various expressions in politics, economy, society and culture and its consequences for the evolution of society as a whole.

Mind is humanity’s highest developed instrument for seeking knowledge. It is an instrument with remarkable capabilities and characteristic limitations. It is ironic that we invest so little time in education and scientific endeavor trying to understand the nature of mental knowledge and the character of the mental processes by which we arrive at it. The objective of this course is to arrive at an understanding of the inherent limits to rationality and mental ways of knowing, as well as the extraordinary creative and intuitive processes by which mind transcends those limitations and tends toward genius.

Thinking is the activity by which mind associates, organizes, coordinates and integrates information, thoughts and ideas. Creative thinking is the process by which mind extends the boundaries of existing thought and knowledge to connect, reconcile and unify previously unconnected or contradictory perspectives. This course will explore the characteristics of mental knowledge and thought processes, types of thinking, the character of rational thought, the mental and social construction of knowledge, deep thinking, creativity and genius. Rather than focus on abstract philosophical concepts, it will apply this knowledge to understand both the sources of humanity’s prolific mental creativity, the characteristic problems it confronts due to irresolvable conflicts and contradictions between mental perspectives, and their resolution in different fields of natural and social science, public policy, collective and individual behavior.

A Post-Graduate Certificate Course in Future Education was conducted by the World Academy of Art & Science, the World University Consortium, The Mother's Service Society, Person-Centered Approach Institute, Dag Hammarskjöld University College of International Relations and Diplomacy and Inter-University Centre, Dubrovnik, Croatia from September 21-23, 2015 at Inter-University Centre, Dubrovnik, Croatia.

Education is our best hope for a better future. Emergence of a new paradigm in education can radically abridge the time required for humanity to address critical issues related to economy, governance, ecology and life-style. Education is the best known instrument for ensuring universal human rights, promoting democracy, enhancing productivity and protecting the environment.There is urgent need to evolve a new paradigm in education appropriate to the needs of the 21st century. Closing the gap between social needs and educational capabilities is essential for addressing pressing challenges confronting humanity today. A review of education today makes evident that there is enormous scope for improving and developing the educational system. Whatever its current limitations in terms of inadequate coverage, quality and content, the means and potential exist for dramatically enhancing humanity’s individual and collective performance in virtually all spheres of our social existence by realistic, achievable improvements in education. We need a new paradigm in education capable of more fully and effectively developing the latent capacities of our youth.

A Post-Graduate Certificate Course in Essence of Effective Leadership was conducted by the World Academy of Art & Science, the World University Consortium, The Mother's Service Society, Person-Centered Approach Institute, Dag Hammarskjöld University College of International Relations and Diplomacy and Inter-University Centre, Dubrovnik, Croatia from March 31 to April 3, 2015 at Inter-University Centre, Dubrovnik, Croatia.

This course explored the characteristics common to leaders in business, politics, civil society, science, arts, professions and education and examined methods by which these characteristics can be consciously developed by individuals. The presentations consist of theory, practical strategies, and a wide range of examples drawn from biography, history, management, and literature from movies illustrating the principles under discussion. Apart from the presentations, our faculty interacted with participants to bring home the theoretical significance and practical relevance of the material.

The Individual is the catalyst of all social progress, the source of creativity, innovation, new ideas and new initiatives. The individual is the genetic source of human diversity. The entrepreneur, inventor, social reformer, revolutionary leader, original thinker and creative artist are a few of individuality's expressions. Yet how little we understand about the characteristics of true individuality, the ways in which it expresses, the means for developing it, and the means for realizing real individuality in one’s own life.

History demonstrates that individuals have the power to change the world. This course explored the relationship between personality and accomplishment. It examined the role of Individuality and Values in personal achievement, growth of personality and social progress drawing on evidence from Management Science, History, Psychology and Literature. It explored the relationship between creative individuals and society searching for insights into the principles and process that govern successful human initiatives and their consequences in various fields of life.

The course was intended for both students and practitioners in all fields interested in advancing theoretical understanding and practical approaches to promote the development of entrepreneurship, individuality, creativity, original thinking and other forms of social innovation. It explored the role of the individual in development of society, elucidated the characteristics of true individuals, the source of their amazing power for accomplishment and the process by which they act as catalysts of social innovation. While the presentation was academic, the objective was to impart original insights and practical knowledge for personal growth and individuation.

Today humanity is confronted by a plethora of serious challenges – political, economic, legal, social, cultural, psychological and ecological. These challenges are complex, interrelated, and global in reach. They are a reflection of the inadequacy of current institutions and policies and at a deeper level the inadequacy of current knowledge. They defy comprehension and resolution based on the prevailing principles of social science. The specialized knowledge developed by separate disciplines is inadequate to deal with the increasingly complex interdependencies of the real world. Knowledge needs to evolve to keep pace with the evolution of society.

The evolution of a complex, highly integrated global society necessitates the development of a more comprehensive and integrated science of society. The division into various specialized fields has been a useful mental strategy for the development of the social sciences, leading to significant advances in all fields – knowledge which needs to be preserved and enhanced by future developments. Yet it is increasingly evident that a more comprehensive and integrated approach is now required. As society evolves, its different functions develop greater complexity. At the same time they become more closely and complexly interlinked and interdependent on one another. Economy today is highly dependent on the political system and laws governing the distribution and enforcement of power in society, legal concepts regarding ownership of property and human rights, public institutions responsible for the creation and management of money, rules for commerce between nations, public policies influencing income and wealth distribution, processes that determine collective decision-making, public investment in education and training, and social expectations regarding economy and the future, etc. A recent announcement by the White House of an ‘intention’ to examine measures to discourage shifting of US firms to tax havens overseas resulted in a 10% fall in market value for several large firms.

Strategic Planning Committee Program Framework

Being a world academy composed of members drawn from the arts, social and physical sciences, humanities, business, public administration and civil society poses fundamental questions. How can WAAS distinguish itself from other national and regional academies? Is there really a common meeting point between art and science? Is there a unique contribution that WAAS can make to the world’s knowledge?

At the New Delhi General Assembly, Fellows explored facets of a new program framework developed by the Strategic Planning Committee (SPC) which seeks to answer these questions in the affirmative. Rather than distinguish itself by specializing on a particular set of disciplines, issues or geographic area, the framework is an attempt to formulate a comprehensive approach and integrated perspective of knowledge inclusive of all disciplinary perspectives and applicable to social problems and opporunities in all fields.

The core of the framework is a human-centered conception of what constitutes reliable knowing, a question posed to the SPC by Ruben Nelson. In his presentation to the GA, Garry Jacobs explained how this conception applies to WAAS’s projects on new economic theory, individuality and limits to rationality. Pushpa Bhargava pointed out that a human centered perspective naturally incorporates ecology, since the survival and full development of humanity depends on its capacity to evolve in harmony with the environment.

New Paradigm Program

Scope: The world confronts multiple crises, each of which resists current efforts at resolution and appears intractable. The environmental crisis of climate change occupied the center stage in the mid-2000s. Fears of nuclear weapons proliferation, which had subsided into complacency in the years following the end of the Cold War, suddenly surfaced with renewed intensity when Korea tested nuclear weapons and long range missiles and news surfaced of Iran’s secret nuclear weapons program in 2007.

Then the subprime mortgage crisis exploded in late 2008, spreading havoc through financial markets across the world. It was followed quickly by a sudden and substantial slowing of economic growth in OECD countries, rising levels of unemployment and most recently a crisis of excessive government debt.

In spite of the enormous attention being given to each of these issues by specialists nationally and internationally, progress on all fronts appears to be nearly at a standstill or at least far too slow to meet pressing human concerns. The times we live in are a Wild West of globalization and the unbridled, unregulated expansion of international activities threatens to destabilize and undermine the remarkable progress of the previous five decades.

This project is predicated on the assumption that each of these problems defies solution because they all represent problems that transcend the sovereign powers of the nation-state. None of them can be fully and satisfactorily addressed by nation-states acting individually. All are symptoms of the evolution of world society to a stage where concerted and coordinated global action is required to meet the collective needs of humanity for peace, security, financial stability, economic welfare and sustainable development. This project has been conceived to address the underlying and interrelated issues that all these challenges pose to global governance.

World University Consortium

The mission of World University Consortium is to evolve and promote development of accessible, affordable, quality higher education worldwide based on a human-centered approach that shifts the emphasis from specialized expertise to contextualized knowledge within a trans-disciplinary conceptual framework reflecting the complexity and integration of the real world, from teaching mastery of a field of knowledge to learning that enhances the capacity of students to think and discover knowledge for themselves, from theoretical mastery to acquisition of knowledge, skills and values relevant to each individual’s personal development and career – an educational system better suited to develop the full potentials of social personality and individuality for productive engagement, social welfare and psychological well-being. The objectives are:

Identify global best practices and develop effective global models and strategies to improve accessibility, affordability, quality, innovation and relevance in higher education appropriate to the needs of the 21st century.

Develop innovative, open learning systems and more effective models that extend the reach of quality higher education to people of all age groups globally.

Explore new models of online and hybrid delivery systems designed to facilitate learning through teacher-student and student-student interaction.

Enhance the learning process through research, development and application of advanced instruments for measurement and evaluation of educational processes.

NEW ECONOMIC THEORY

A multidisciplinary group from the World Academy of Art & Science and the Club of Rome are leading a quest for a new human-centered theory of economics that reflects recent changes resulting from the emergence of a service-based economy, globalization, rising social aspirations and changing values, and is integrated with political, social, ecological, technological, and cultural factors from which it is inseparable.

PROGRAM ON GLOBAL EMPLOYMENT CHALLENGE

Access to employment is the most essential requirement for providing economic security to the world’s burgeoning population.

This interdisciplinary dialogue explores theoretical and practical aspects of the global employment challenge, including its demographic, economic, legal, political, psychological dimensions as well as linkages with the international financial crisis, social stability, and terrorism.

EVOLUTION OF INDIVIDUALITY

Individuality is the crown of human evolution and the catalyst for social progress, yet there are very different conceptions of what constitutes true individuality, the relationship between the individual and society, and whether humanity is inevitably evolving toward higher levels of individuality.

This project will explore the essential nature of individuality, the social and cultural factors that foster it, its role in social development, its myriad expressions in the original thinker, creative artist, political leader, entrepreneur, inventor and social innovator, and the means available to society to foster it.

GLOBAL RULE OF LAW

The evolution of international law and human rights represent crucial threads in the progressive development of global rule of law.

This project will explore the relationship between the social, political and legal dimensions of global rule of law in an effort to frame the boundaries of a wider approach to the evolution of global governance. Emphasis will be place to re-examining the concept of national sovereignty and the common rights of humanity in an increasingly globalized world.

NEW SCIENCES

In 2013 WAAS launched a project to explore important developments in recently emerging fields of science, with e-conferences on the Science of Networks and the Science of Complexity. The project involves an application of concepts and tools from the new sciences relevant to address the global challenges confronting humanity today and to the evolution of a transdisciplinary science of society.

PROGRAM ON ABOLITION OF NUCLEAR WEAPONS

The devastating consequences of nuclear war and the potential destructive applications of science and technology were paramount concerns among Albert Einstein, Bertrand Russell, Robert Oppenheimer, Joseph Rotblat and others which led to the founding of the World Academy in 1960.

Nuclear disarmament is a sine qua non for effectively addressing other issues of global important – terrorism, financial stability, unemployment, poverty, climate change, democratization of the UN and other aspects of global governance. In recent years, the Academy has conducted numerous conferences, seminars and workshops and collaborating with other organizations in an effort to promote concrete steps toward immediate and total global nuclear disarmament.

TRANS-DISCIPLINARY DIALOGUE ON THE LIMITS TO RATIONALITY

Rationality is an essential instrument in humanity’s quest for knowledge, yet the practical pursuit of knowledge often ignores or violates fundamental principles of rational inquiry or overlooks the inherent limitations in the use of rationality as an instrument of knowledge.

This project will explore the philosophy and practice of rationality as it is applied in various fields of knowledge to identify common deviations and limitations and propose ways to compensate for the limits to rationality.

The Security & Sustainability Guide

A 250-page “Interim Draft” PDF of The S&S Guide, a project of the World Academy of Art & Science, will be available for limited distribution free of charge to WAAS Fellows in June 2016. It reflects the critical fact that sustainability and security are both essential and can only be achieved in concert. The Guide is incomplete, but the compilers believe that, even in its current state, many WAAS Fellows will nd it useful for illuminating many of the most serious problems facing humanity under the broad, overlapping categories of “Security” (weapons proliferation, terrorism, cyber-attacks, economic and food insecurity, human rights, peacemaking, crime and corruption, inadequate infrastructure, etc.) and “Sustainability” (climate change, biodiversity loss, pollution, energy, agriculture, population growth, cities, oceans, forests, vulnerability to disasters, green economics and nance, etc.)